HKCB to boost working capital with $284m issue

PUBLISHED : Wednesday, 17 November, 1993, 12:00am
UPDATED : Wednesday, 17 November, 1993, 12:00am

HKCB Bank Holding Co is planning to issue 55 million Swiss francs (about HK$284 million) of convertible bearer notes to raise funds for general working capital purposes.


Arranger Bank Julius Baer & Co may require HKCB to increase the issue to 65 million francs.


The six-year notes, carrying an interest rate of 1.625 per cent a year, will be placed mainly with investors in Switzerland and will not be offered for sale in Hong Kong.


The shares to be issued on conversion of the notes will be no more than 20 per cent of HKCB's issued share capital as at June 28.


Each note, with a denomination of 50,000 francs, will be convertible into the number of HKCB shares produced by dividing that sum by the conversion price.


HKCB expects to fix the initial conversion price on or about November 22 at 21 per cent above the average closing price of HKCB shares for the five consecutive trading days to November 22.


The notes will mature in December 1999 and will be redeemable in US dollars. HKCB plans to fix the exchange rate between Swiss and US currencies for the redemption on November 22.


HKCB has already obtained approval from the Hong Kong Monetary Authority for the issue.


No application will be made for the notes to be listed on any stock exchange.


The issue will not give rise to any adjustment to the subscription price of HKCB's existing warrants.


In August, HKCB reported a 42.3 per cent rise in net profit to $44.77 million.


At that time, it revealed its plans to explore investment opportunities in the financial services sector.